ACCA · Question 10 · Review and Reporting

SECTION A - CASE 2: GREENYIELD AGRI-COOP

GreenYield Agri-Coop is a large agricultural cooperative. You are the audit senior for the year ended 30 September 20X5.

During the audit, you note the following:

1. A severe, unprecedented drought during the summer of 20X5 has decimated crop yields, raising significant going concern issues.
2. On 15 November 20X5, a major customer of GreenYield, who owed $1.2m at the year-end, declared bankruptcy due to a fraud discovered in October 20X5.
3. Management has prepared cash flow forecasts for 12 months from the date of approval of the financial statements, showing a severe cash shortage unless a bank loan is renegotiated.
4. Management refuses to provide a written representation confirming their assessment of the cooperative's ability to continue as a going concern.

Question:
If a 'Material Uncertainty Related to Going Concern' section is included in the auditor's report, where should it be positioned according to ISA 700 (Revised)?